One news item that strangely hasn’t been covered widely today: new mortgage funds showed a 98% decline in freshly closed mortgages in the US in August 2008. That is a massive decline that points to a total crash of the housing market in the US. I don’t think there has ever been such a sharp decline in the history of the mortgage market before: its certainly interesting but also devastating news since such decline in interests in buying houses will certainly mean the property prises will plummet.
It’s not strange, of course, that no one wants to buy a house at the moment. You must be somewhat insane if you buy a house now, with the prospect of seeing you money vaporize before your eyes. Since housing prices will almost certainly take a fall people wait to see when they will hit rock bottom. For the mortgage industry this is, however, more bad news on top of the bad mortgage assets problem and it’s a good example of the domino effect a crisis can have.
That said, I have always thought there is so much beauty in crisis. Artists should be painting these domino movements of the crashing markets, poets should write poetry that reads like massive inflation. To live in a challenge is the only life worth living – it is exactly when things get rough that the beauty of it all also surfaces.
If there are any artists, poets or musicians out there who want to collaborate on a project evolved around crashing markets, Loewak would gladly hear from you.